AUD/USD hangs near weekly low, remains depressed below 0.6300 on stronger USD

AUD/USD remains under some selling pressure on Friday amid a modest USD strength.
Thursday’s disappointing jobs data undermines the Aussie and contributes to the slide.
The optimism over China’s stimulus and hopes for a US-China trade deal to limit losses.

Haresh Menghani FXStreet

The AUD/USD pair struggles to capitalize on the overnight bounce from the 0.6270 area or a one-week low and meets with a fresh supply on Friday. Spot prices remain depressed below the 0.6300 mark through the first of the European session and could slide further amid a goodish pickup in the US Dollar (USD) demand.

The Federal Reserve (Fed) maintained its forecast for two 25 basis points rate cuts in 2025 at the end of March policy meeting on Wednesday and gave a bump higher to its inflation projection. The outlook assists the Greenback to build on its modest recovery from a multi-month low for the third straight day and climb to a fresh weekly high. Apart from this, concerns about the potential economic fallout from US President Donald Trump's trade tariffs and geopolitical risks benefit the safe-haven buck. This, in turn, is seen exerting pressure on the AUD/USD pair.

The Australian Dollar (AUD), on the other hand, is undermined by the disappointing domestic jobs report released on Thursday, which showed that the number of employed people declined by 52.8K in February. The reading missed consensus estimates for a 30.0K increase by a big margin and raised concerns about potential weakness in the labor market. This could provide the Reserve Bank of Australia (RBA) more room to lower interest rates, which keeps the AUD bulls on the defensive and further contributes to the offered tone surrounding the AUD/USD pair.

Any meaningful USD appreciation, however, still seems elusive amid expectations that the Fed will resume its rate-cutting cycle sooner than expected amid worries about a tariff-driven slowdown in the US economic activity. Adding to this, the optimism over China's recent stimulus measures and hopes for a US-China trade deal could limit losses for the China-proxy Aussie. US Senator Steve Daines will visit China for trade talks – marking the first high-level political meeting since Trump’s return – to revive stalled trade negotiations amid rising tariff tensions.

Moving ahead, there isn't any relevant market-moving economic data due for release from the US on Friday, leaving the USD at the mercy of speeches from influential FOMC members. This, in turn, could provide some impetus to the AUD/USD pair and produce short-term trading opportunities heading into the weekend. Nevertheless, spot prices remain on track to register losses for the first time in three weeks as the focus now shifts to the release of the flash global PMIs on Monday.

US-China Trade War FAQs

What does “trade war” mean?

Generally speaking, a trade war is an economic conflict between two or more countries due to extreme protectionism on one end. It implies the creation of trade barriers, such as tariffs, which result in counter-barriers, escalating import costs, and hence the cost of living.

What is the US-China trade war?

An economic conflict between the United States (US) and China began early in 2018, when President Donald Trump set trade barriers on China, claiming unfair commercial practices and intellectual property theft from the Asian giant. China took retaliatory action, imposing tariffs on multiple US goods, such as automobiles and soybeans. Tensions escalated until the two countries signed the US-China Phase One trade deal in January 2020. The agreement required structural reforms and other changes to China’s economic and trade regime and pretended to restore stability and trust between the two nations. However, the Coronavirus pandemic took the focus out of the conflict. Yet, it is worth mentioning that President Joe Biden, who took office after Trump, kept tariffs in place and even added some additional levies.

Trade war 2.0

The return of Donald Trump to the White House as the 47th US President has sparked a fresh wave of tensions between the two countries. During the 2024 election campaign, Trump pledged to impose 60% tariffs on China once he returned to office, which he did on January 20, 2025. With Trump back, the US-China trade war is meant to resume where it was left, with tit-for-tat policies affecting the global economic landscape amid disruptions in global supply chains, resulting in a reduction in spending, particularly investment, and directly feeding into the Consumer Price Index inflation.

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD falls to near 0.7100 after slipping below 50-day EMA

AUD/USD depreciates after registering minor gains in the previous day, trading around 0.7120 during the Asian hours. The technical analysis of the daily chart shows the pair consolidating sideways within a rectangle pattern, as neither bulls nor bears gain control. The AUD/USD pair is holding a slight bearish tone however as it sits beneath both the nine-day and 50-day EMAs.

Japanese Yen edges up but remains close to the 160.00 intervention threshold

The Japanese Yen edges up against the US Dollar on Friday, but the USD/JPY pair remains above 159.90 at the time of writing, unable to put a significant distance from the 160.00 level, considered the limit of tolerable JPY weakness for Japanese authorities.

Gold returns to the red, awaits US NFP

Gold price is looking to test the weekly lows, while in the red near $4,450 in the early European session on Friday. The precious metal remains vulnerable amid ongoing geopolitical turmoil. Traders will closely monitor the developments surrounding the US-Iran peace deal and the US May employment report later on Friday.

Arthur Hayes' “Holy Trinity” is dead: Exits Zcash after Orchard Pool exploit

Arthur Hayes has entirely dumped his “Holy Trinity” holdings by offloading his Zcash holdings on Friday. The privacy coin is down 13% so far on Friday, extending Thursday’s 26% decline after an Orchard Shielded Pool audit revealed a critical vulnerability that allowed the undetectable minting of fake coins. Hayes continues to hold Worldcoin ahead of the upcoming SpaceX Initial Public Offering, on the chance of a “high-beta proxy” rally.

Nonfarm Payrolls set to show stable labor market in May as markets digest Fed hawkish shift

The United States Bureau of Labor Statistics will release the Nonfarm Payrolls data for May on Friday at 12:30 GMT. Investors expect NFP to rise by 85K following the surprisingly strong 185K and 115K increases recorded in March and April, respectively.

Recession on paper: What really moves the Canadian Loonie now?

Statistics Canada handed the headline writers a gift and the analysts a headache. Real GDP shrank 0.1% on an annualized basis in the first quarter, and with the fourth quarter of 2025 revised down to a 1.0% contraction, that is two negative quarters in a row, the textbook definition of a technical recession and Canada's first since the pandemic.